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Version Superseded: 21/07/2008
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(1)Subsection (2) applies if a member of a registered pension scheme (or the member’s personal representatives) assigns or agrees to assign
[F1(a)any benefit, other than an excluded pension, to which the member (or any dependant of the member) has an actual or prospective entitlement under the pension scheme, or
(b)any right in respect of any sums or assets held for the purposes of any arrangement under the pension scheme].
(2)Unless the assignment or agreement is pursuant to a pension sharing order or provision, the pension scheme is to be treated as making an unauthorised payment to the member (or to the member’s personal representatives in respect of the member).
(3)Subsection (4) applies if a person (or a person’s personal representatives) assigns or agrees to assign
[F2(a)any benefit, other than an excluded pension, to which the person has an actual or prospective entitlement under the pension scheme in respect of a member of the pension scheme, or
(b)any right in respect of any sums or assets held for the purposes of any arrangement relating to the member under the pension scheme].
(4)Unless the assignment or agreement is pursuant to a pension sharing order or provision, the pension scheme is to be treated as making an unauthorised payment to the person (or the person’s personal representatives) in respect of the member.
(5)The amount of the unauthorised payment is the greater of—
(a)the consideration received in respect of the assignment or agreement, and
(b)the consideration which might be expected to be received in respect of the assignment or agreement if the parties to the transaction were at arm’s length [F3 and any power to reduce the entitlement to the benefit or right did not exist].
(6)Where a pension scheme is treated by this section as having made an unauthorised payment in relation to an assignment (or an agreement to assign), payments by the pension scheme of the benefit [F4or right] assigned (or agreed to be assigned) are not unauthorised payments.
[F5(7)An excluded pension is so much of any pension which under pension rule 2 may continue to be paid after the member's death as may be so paid.]
(8)“Assignment” includes assignation and related expressions are to be read accordingly.
Textual Amendments
F1S. 172(1)(a)(b) substituted for words (6.4.2006) by Finance Act 2005 (c. 7), Sch. 10 paras. 37(2), 64(1)
F2S. 172(3)(a)(b) substituted for words (6.4.2006) by Finance Act 2005 (c. 7), Sch. 10 paras. 37(3), 64(1)
F3Words in s. 172(5)(b) inserted (6.4.2006) by Finance Act 2005 (c. 7), Sch. 10 paras. 37(4), 64(1)
F4Words in s. 172(6) inserted (6.4.2006) by Finance Act 2005 (c. 7), Sch. 10 paras. 37(5), 64(1)
F5S. 172(7) substituted (6.4.2006) by Finance Act 2005 (c. 7), Sch. 10 paras. 37(6), 64(1)
Modifications etc. (not altering text)
C1Pt. 4 modified (6.4.2006) by The Pension Protection Fund (Tax) Regulations 2006 (S.I. 2006/575), regs. 1, 12
C2Pt. 4 modified (6.4.2006) by The Pension Protection Fund (Tax) Regulations 2006 (S.I. 2006/575), regs. 1, 13(5)
C3Pt. 4 modified (6.4.2006) by The Pension Protection Fund (Tax) Regulations 2006 (S.I. 2006/575), regs. 1, 9, 10
C4Pt. 4 modified (6.4.2006) by The Pension Protection Fund (Tax) Regulations 2006 (S.I. 2006/575), regs. 1, 26
Commencement Information
I1Ss. 160-274, 281, Schs. 30-35 in force at 6.4.2006 but any power to make an order or regulations under those provisions may be exercised at any time after Royal Assent, see s. 284
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